An analytical approach for making management decisions concerning corporate restructuring

✍ Scribed by Beixin Lin; Zu-Hsu Lee; Richard Peterson

• Book ID: 102499940
• Publisher: John Wiley and Sons
• Year: 2006
• Tongue: English
• Weight: 179 KB
• Volume: 27
• Category: Article
• ISSN: 0143-6570
• DOI: 10.1002/mde.1302

✦ Synopsis

Internal corporate restructuring activities, such as downsizing, sale or termination of a business line, facility closure, consolidation, or relocation, often occur as part of managerial strategies intended to improve efficiency, control costs, and adapt to an ever-changing business environment. Such actions frequently result in fundamental changes in a business's organization, its strategies, its systems, and its operations. They can unsettle a business and often significantly affect current and future earnings and cash flows. In this paper we propose a novel decision-making model through the use of the dynamic programming technique to illustrate how management can determine the optimal timing and appropriate restructuring actions that maximize the benefits of a restructuring program.